Is a buyer required to inquire as to whether a LLC-seller is a “disregarded” entity? - Alabama Department of Revenue

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Is a buyer required to inquire as to whether a LLC-seller is a “disregarded” entity?

Is a buyer required to inquire as to whether a LLC-seller is a “disregarded” entity?

Alabama law requires the buyer to withhold tax on the sale or transfer of Alabama real estate by a nonresident. In order to withhold, the buyer must determine if the “seller” is a nonresident. Inherent in this provision is the need to properly determine the “seller” of the property. As such, the buyer must inquire as to whether the LLC-seller is a disregarded entity in order to properly determine the seller.

Is the money from a Florida 529 Savings Plan taxable if it is used to pay for my child’s higher education expenses?

Yes, once the withdrawal is made, it would be taxable on your Alabama income tax return.

When rolling over an out-of-state 529 plan to the CollegeCounts 529 Plan, is the rollover into the fund (contributions and earnings) exempt from any current year Alabama income tax?

The rollover is exempt from Alabama income tax.

Does Alabama income tax law recapture previously deducted contributions when withdrawing money from a CollegeCounts 529 Plan for non-qualified expenses?

Yes, the amount withdrawn is added back to the contributing taxpayer’s return, plus a 10 percent penalty.

If the money from my CollegeCounts 529 Plan is used to pay for my child’s expenses at an out-of-state college, will it be considered taxable?

No, the money is not taxable as long as the money is used to pay for higher education expenses.

Are rollovers from a CollegeCounts 529 Plan to an out of state plan subject to recapture of previously deducted contributions?

Yes.

What is the deadline for contributions to be deductible on your Alabama tax return?

The postmark date on your contribution will be accepted as the date of the contribution, as long as it is on or before December 31. The contribution does not have to be received by the plan on or before December 31.